China's Economic Policy Today: The New State Activism

A noted American authority and investigator of China's economy outlines the general features of the ongoing reorientation of Chinese economic policymaking toward increased state activism, which has gained momentum in the aftermath of the global financial crisis. An initial section of the paper describes the marketization and privatization initiatives of China's late reform period to provide a baseline against which to measure the subsequent shift toward increased state intervention and guidance in the economy. The author traces the shift in three critical policy arenas (social policy, state-owned enterprises, and industrial and technology policy) and demonstrates how state involvement in each intensified during the global financial crisis. He then proceeds to explore the implications of accelerated state activism in the future, identifying potential rewards as well as large risks. Among the latter are macroeconomic imbalances, a "softening" of budget constraints, difficulties in recognizing and terminating unsuccessful economic programs, and tensions with trading partners.     

Multilevel Instruments for Infrastructure Investment: Evaluating State Revolving Funds for Water

In recent decades, the federal government has introduced complex, multilevel state‐operated revolving loan fund programs as an instrument for promoting state and local investment in national infrastructure priorities while limiting direct federal involvement in implementation. A federally funded state revolving fund (SRF) program combines features of a categorical matching grant to states and a subsidized loan program to localities, both of which should lower the effective price of infrastructure investment and therefore promote higher levels of infrastructure investment. However, little evidence exists to date on whether these programs stimulate new subnational spending or instead displace spending that would have occurred otherwise. We evaluate the stimulus effects of SRFs by examining the two largest such programs, the Clean Water and the Drinking Water SRF Programs. Analyzing 17 years of state‐level panel data, we find evidence that the flow of federal funds to states under the SRF programs stimulates new local investment in wastewater infrastructure, but not in drinking water infrastructure. In discussing several possible explanations for these divergent results, we argue for further research that emphasizes the intergovernmental features of this financing tool.     

Nuclear fears,hopes and realities in Pakistan

In the four decades since Pakistan launched its nuclear weapons program, and especially in the fifteen years since the nuclear tests of 1998, a way of thinking and a related set of feelings about the bomb have taken hold among policy‐makers and the public in Pakistan. These include the ideas that the bomb can ensure Pakistan's security; resolve the long‐standing dispute with India over Kashmir in Pakistan's favour; help create a new national spirit; establish Pakistan as a leader among Islamic countries; and usher in a new stage in Pakistan's economic development. None of these hopes has come to pass, and in many ways Pakistan is much worse off than before it went nuclear. Yet the feelings about the bomb remain strong and it is these feelings that will have to be examined critically and be set aside if Pakistan is to move towards nuclear restraint and nuclear disarmament. This will require a measure of stability in a country beset by multiple insurgencies, the emergence of a peace movement able to launch a national debate on foreign policy and nuclear weapons, and greater international concern regarding the outcomes of nuclear arms racing in South Asia.     

The Taliban,Public Space,and Terror in Pakistan

Two UK-based specialists on terrorism in Pakistan use empirical evidence to document and analyze the Pakistani Taliban's (Tehrik-e-Taliban) practice of targeting spaces of public interaction for terrorism intended to suppress expressions of public unity and restrict venues for open discussion. In tracing the rise of the Taliban in Pakistan, the authors review the country's history of state and civil society formation, its relations with Afghanistan, and U.S. and Western policy in the region. The authors present timely information and insights that enhance understanding of the recent surge in terrorist attacks on civilians in Pakistan and its ties to the eastward spread of conflict from neighboring Afghanistan.